First-time buyers aiming to purchase a home could consider buying a property in need of refurbishment work as a means of saving their nest egg.

Paul Holmes, chief executive officer of first time buyer mortgage site Firstrung, believes buying a "fixer-upper", as it's termed in the US, could represent a hidden opportunity for first time buyers who are prepared to think "outside of the box".

Holmes suggests first time buyers should compete with property developers to uncover their own opportunities.

He explained: "As the Americans call it, sweat equity' can reap rewards, both short and long term. Quite frankly, you'll be buying ahead of the curve' the type of properties keen developers would want to repair to then quickly re-sell back to the market with profit or equity that could be yours.

"The rewards can be excellent, with first time buyers typically building themselves 15 to 20 per cent equity upon completion of the programme of works."

Describing the process as "buying ahead of the curve", Mr Holmes stated that first time buyers could purchase the kind of properties that are targeted by developers hoping to improve them, and then sell them back to the market at a higher price.

Earlier this month, Robin Amlot, senior editor at Moneyextra.com, reported that the average mortgage deposit put down by first time buyers in February this year was 11 per cent higher than the corresponding month in 2006.